slow growth, durable goods, going down a cliff, and suggesting an economy that is stumbling. let's bring in mary kissel. >> thank you for having me. speak to a new economic patriotism. what does that mean? should we buy american or not criticize the economy because it's un-american? >> it means that you should buy the argument that he is not the one responsible for the economy that we have now. he wants you to think any focus on the future and not the present. it is really quite an amazing advertisement. ashley: when you look at the numbers, they are not particularly good. you would think that they should play right into the hands of mitt romney, but he doesn't seem to be taking advantage of it. it suggests, the pulls through, that mr. obama is extending his lead remark there is certainly a

lot to you can take issue with. he going to devalue the dollar little further? give tax breaks to companies he is taking credit, he wants to spend more taxpayer money on infrastructure, math and science, ashley, where people who buy it. ashley: what's interesting is that he has managed to frame this, if you like by blaming the rich people who are just not

paying their fair share. be gaining some traction. >> we have written a lot about this. it is a claim that he repeated in this advertisement. he said let's reduce the deficit by $4 trillion and raise the taxes on the wealthy. that means nothing in an economy where we would be running more than $1 trillion the annual deficit. mitt romney needs to come out and just do the arithmetic for people. the average american understands state of this economy. the banks on wall street monday doing good,. ashley: case in point. ohio, which is a very important swing state, if you look at

their personal income since december 2007, it has risen a whopping 2.1%. in nearly five years. mr. obama has a lead not. >> yes, the pools are an open question. i don't buy it, but i'm not a professional pollster. i think we do raises another interesting point. which is what this administration promises, we did not promise certain things -- but he promised that he would have the deficit, and where are we? the deficit has doubled and the president said that he would reduce the cost of health care. that has gone on. ashley: the numbers are there. let's bring in our next guest.

he talks about the need for economic patriotism. >> given how many times we have heard people from the left refer to economic patriotism,. that makes me nervous. that could kill jobs, make businesses suffer, here he is, running as a central part of a campaign message. running on something that he said would previously damage the economy. ashley: i will come back with you in a second. the other side, do we need more specifics for mitt romney? i mean, you could argue we've been lacking so far. >> well, yeah, look. i think that mitt romney should

offer more specifics. mitt romney has many issues with taxes, but the president didn't raise taxes. it appears the other day and then yesterday, if you are expecting a big tax cut for me, don't. because i will close the loopholes. it would be like a pharmaceutical company leaving with a message from the side effects. i think you could go a step further and say what the president is saying to you is that 2% growth, 8% unemployment, real income is down and the trillion dollar deficit is up. i don't believe that.

ashley: despite these gloomy numbers, the facts for themselves. why is it that the president made you believe the president, they are running campaigns out across the country. they are calling this the clinton bump. they believe that bill clinton standing up for barack obama, offering a testimonial on behalf of the president, it has made people feel better about this. ashley: always looking for the big one.

you have to come up with your own line. some people are already writing him off the record i don't know if it is a valid the policy specifics. look, the reality is that the american public is not going to want to mitt romney suddenly. the campaign has spent months if not years trying to do that. now is the time to set up broad picture and say that this is not the best we can do. and to be bold. mitt romney back from his tax-cut proposal, you can't go to the american public with that. the american public wants a choice. every time they have been bold, whether with government reformer that 20% across-the-board income tax cuts, that is when he has a bump in the polls. we will see if that is how it goes when it comes to the debate. ashley: what does he have to do in his first debate? you're right, he's not exactly a warm and cuddly candidate, but

he is his own worst enemy. what does he need to do? >> i actually agree with mary. i think that that that is his job as their greatest make himself look like a plausible president but in doing that in a way that offers a broad and bold vision and talks about conservative reform. mitt romney, in some way, is in a unique position. he can argue that he is the turnaround guy. tell people the truth, say that he can survive going the way that we are going. ashley: okay, thank you very much mary and steve. we really appreciate it.

we want to know what you think. love under gerriwillis.com and vote on the right-hand side of the screen and i will share the results of the end of "tonight show." still to come, this our aps work for the government. we will break down how some are getting paid more than their private sector counterparts. some of these issues and more. don't go away

this is a test.

ashley: while the health care law got the okay from the supreme court, seven out of 10 americans think with some changes, obamacare may be okay.

what does this mean? a fellow from the manhattan institute is here to talk about it. it is interesting. this new pool basically says that americans believe that there is not going to be a total repeal of obamacare. in some formal fashion. it will only be in effect. >> i think that there is gridlock in washington. hardee's ashley: does that hurt mr. romney's chances? a lot of people believe, perhaps, maybe as a case of

inevitability. but they believe that throwing it all out and starting again maybe worth it more so than using what's on the table. >> even some obamacare supporters say that in states like ohio and minnesota, you will see the prices go up by 40%. the debates that are coming up, i think that conservatives need to make the case that there are enormous problems. it will reduce access and drive up costs. there is real choice here in the real option that we have go towards a better way. ashley: are there any sites where both sides agree things are good? >> i think people should move towards the health care market place.

are you going to level the playing field. ashley: 63% of americans say they do want things we do not. >> people have a sense that the governors have a stake in things like balancing budgets, working in a bipartisan manner, and the problem that the radians are facing are not the same as minnesotans for new yorkers. giving more states the ability to set their priorities is the right way to go. >> is mitt romney on a bit of a tightrope when it comes to obamacare? >> there is a similar law that was passed when he was governor of massachusetts. can you present on one hand and criticize it on the other?

>> every state is unique. it was terribly overregulated. individuals will pay thousands of dollars a month to buy their own coverage. massachusetts -- ashley: is it similar to that health care law? >> governor romney had a lot more choice and less regulation. democrats, the democratic legislature, he made it much more expensive than what governor romney wanted. the end result was very different. ashley: mitt romney and paul ryan has proposed something premeditated. how does that help the program. >> the idea is that there is tremendous weight in the program. the gao estimates at least 10% per year, and that is a 400 billion-dollar program. $40 billion annually. larger larger than 48 state budget. here is the support you get for

your children and long-term care and disabled. if you want to spend something about that, that's okay. it will force you to make smarter decisions. you waste and fraud out of the program and focus on getting better care. ashley: this is a huge issue. >> it is a term in this issue. we are living on borrowed time in a lot of ways. we have tremendous deficit. fiscal cliff, health care, it is enormously expensive, it is driving a problem. one of the biggest reasons for dead. >> we need to fix the problems facing people throughout the years. ashley: very good. paul howard, thank you for being here. okay, so if you are fired up about this or any others, send

us an e-mail at fox business.com. gerri willis at fox business.com. >> new numbers are out. rich edson is here with the latest details next. this used to be a land where americans dreams come true. did the golden state loses shine for dead? michael reagan weighs in. you play your cards right, you, too, can cash them at mitt romney did on his tax returns. we are on the case on "willis report"

yeah, i'm looking to save, but i'm not sure which policy is right for me. you should try our coverage checker. it helps you see if you have too much coverage or not enough, making it easier to get what you need. [ beeping ] these are great! [ beeping ] how are you, um, how are you doing? i'm going to keep looking over here. probably a good idea. ken: what's a good idea? nothing. with coverage checker, it's easy to find your perfect policy. visit progressive.com today. ashley: is worker pay unbalanced? a look at who on the government's payroll is making the most money. the findings may surprise and a paul you

ashley: new polls show that state government workers are making more than their private sector counterparts. rich edson has a look at the striking differences. reporter: hello, ashley. a watchdog here in dc this state government workers on average make more than 6% more in pay and benefits than those working for private companies. citizens against government waste is that is the case where employees performing the same job. >> hard-working americans were struggling to pay their bills, find a job, or find enough money to set aside for retirement are being forced to pay for these extravagant employee compensation packages. these employees are supposed to be public servants. not a privileged class. ashley: the numbers vary by state. the reports say new hampshire,

rolled rhode island, south dakota and wyoming. six of the largest gap are california, new york, north carolina, ohio and texas. he referred fox business to an economic policy institute posting, saying that these claims are bunk and study after study has provided similar claims. if anything, public sector workers, most of whom have college breeze or higher, we have comparable, private sector workers. pensions are underfunded because of the market crashed during a recession communal equities have recovered since then. ashley: rich edson, thank you very much. who on the government payroll are making the most money, if you are wondering. in tonight's top five from the most ridiculously overpaid government workers according to business insider.

number five is a sewage worker in new york city making more than $197,000 a year according to the "new york post." christopher carlson of brooklyn were more than 2100 hours of overtime to bring home the huge paycheck. number four are lifeguards. like the beach. earning $200,000 per year in orange county, california. the two lifeguard chiefs at the newport beach area, raking in the big bucks says the city faces the highest debt in the county. number three is a suspended prison surgeon in california earning more than $259,000 a year. this despite being accused of incompetence. number two is a hospital executive at the university of texas makes nearly $842,000 a year. he is actually retired and takes on this monitor has philanthropy

work rate and the number one ridiculously overpaid worker is a small town administrator in california. robert rizzo was the ringleader of california's corrupt officials. on top of his huge salary, $1.5 million, he had over 100 vacation days in a month's worth of sick time. as good a job as you can get it. he is awaiting trial on corruption charges. when we come back, are you ready for some properly officiated football? the packers are. california, here we come. they are leaving in droves from the golden state. why the mass exodus? michael reagan gives us his very next

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ashley: the golden state is not looking so golden. california residents are exiting in droves. more americans have left the state in the past few years than have come to live in it. our next guest says things are so bad, even illegal people are leaving the state. michael reagan, founder of the reagan group, is joining me now. he used to be california, here we come. >> the back of fact that the taxes are so high, whether it is just tax or state taxes come back in our state government, state government -- let me give you an example. about three months ago, the state voted to take a billion dollars, from education and low income housing. why did he they do that? because they knew that they couldn't put a ballot measure out to raise taxes of people are going to give the money to low income housing.

now we have a ballot measure to raise our taxes even more. sales taxes, and of course from state income taxes. young couples can no longer afford to live in a state of california. those are the ones that are leaving for texas, arizona and so forth. >> understand, they put the new budget together in the governor signed it. it was all predicated on facebook. [laughter] all that money was going to take care of the world coming from facebook for it yet, one of the owners from facebook turned in his passport and let the united states of america. we discuss news the other day, the department of water and power is going to increase rates

10%. we are having a shortage of water. they are increasing their rates. there is actually no competition at all. i will give you an example. i paid $200 per month of my department of water and power bill to underwrite people who cannot afford to pay their own water bill in los angeles. it cost me $200 a month to help them out. ashley: you are very generous. >> i'm trying to help my daughter who is a school teacher and my son who sells cars. i'm helping them. there are a lot of people who help their kids. at the same temperament are helping everybody else. select the end of the month, you may be a little bit short. wait a minute, they charged charge me another $200 a month to deliver water and power to my house. i never turn on the light were

never turned on the water spigot, i still get charged $200 per month just for the privilege of having water and power. ashley: stockton, san bernardino, mammoth lakes, on the verge of declaring bankruptcy or have declared bankruptcy. how credible this go? >> it's going to go further. every week they will have someone new. this whole state is in fact from a bankrupt. you saw them vote to change pension laws. those will end up in court, as they always do. in the fresno area, which is the bread basket of the world, to food once a week to be the farmers who can't get water to grow crops. two years ago they were feeding them carrots from china. the reason these people were in line to get food was because they had no water to grow their own carrots. i mean, this has gone crazy

here. ashley: out-of-control. >> out of control. >> more cities and townships going bankrupt. until california wakes up and changes was going on in sacramento. ashley: you need to get out quickly, i have a spare bedroom, gimme a give me a call and i can set you up. >> i love new york city. i might want a 16-ounce drink someday. [laughter] ashley: may be of alcohol. that would be better. michael reagan, i really appreciate you joining us. good luck in california. new developments tonight. the stories we've been covering. first, whether you are a browns fan or a ravens fan, the big cheers tonight maybe for the referees. it ended the nfl lockout for the officials. the substitute referees being loudly criticized by fans, including president obama for

blown calls, including one outcome by monday night's game. nfl commissioner roger giselle apologizing to the fans. >> the labor management disputes and negotiations are difficult. what is most difficult about it is you have the two parties, but you have a lot of parties outside of the room. they get impacted by a comment including our fans. we are sorry to bring the general public and friends through that. ashley: by the way from the national hockey league canceling its entire preseason schedule due to failed contract talks with the players. also, american airlines firing back at the pilots. despite a canceled and delayed flights this month. the union says, no, there is no organized slowdown.

this stems from american airlines, which is under bankruptcy protection, canceling union contracts is usual. meanwhile, the 47% who don't pay federal income tax, a new study by the tax foundation takes a look at the 50 million americans who are actually collecting benefits from the government. scott hobbs joins me now. the president of the tax foundation. what surprises you most about the study? >> well, we looked at this huge growth that we have seen in nonpayers over the past 20 years and wondered what impact does that have in a federal budget. it is associated with an increase we are seeing more the fact that these people don't pay income taxes than they are getting a lock in benefits.

>> does have exploded over the last 20 years. the irs has turned into a super agency. delivering child credit, delivery credit, a whole host of things. $100 billion a year in cash. it has really become an extension of the welfare state. ashley: we know this is not

good. you get more people who benefit from government better paying end. you know, as benjamin franklin said, it is the end of the republic when people don't have money. ashley: that is a good soundbite that we have from hillary clinton, a good segue for that we met one of the issues that i have been preaching about round the world is collecting taxes in an equitable manner. especially from the elite in every country. it is a fact that around the world elites of every country are making money. and yet they do not contribute to the growth of their own country's. ashley: scott, if it wasn't for the rich, how would they be paid

for? >> i guess we are seeing this come forward. but she is ignorant of the fact that the united states has the most progressive income tax program in this country. while the poor people in america have the lowest tax burden of any industrialized country, we are already soaking the rich a little bit more, and it's not going to solve the problems of america. ashley: very quickly, what about the nonpayers issue? >> we need non-fundamental tax perform. the tax code is always protecting the poor. but now we are protecting the middle class from income tax as

well. ashley: that it's interesting stuff. scott, thank you for joining us. we really appreciate it. coming up, find out where consumers are putting their money these days and he is under fire for a 14% tax rate. but anything that romney can do, you can do, too. we have these tax tips after the break. when we got married.

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ashley: mitt romney got lots of media attention over recently releasing his tax returns. he paid an effective tax rate of 14.1%. many middle american income americans paid a lot more than that. but it turns out there are tricks to paying as much as mr. romney did. herewith more, we have rich copper. thank you for being here. okay, we have all this money and he is only paying a rate of 14.1%. but he did not break the rules. he played by the wilson was given. >> exactly, i don't think people realize it. mitt romney like warren buffett

was talking about a lower rate to the reality. these people are paying their fair share, it is not ordinary income and people have to realize that ordinary income is taxed at a higher rate than passive income. >> so working people out there do to follow mr. romney's lead? >> there are a number of things you can do to help out. for someone who is an ordinary earner, absolutely, they can take advantage of your willingness to part with money and use appreciated stock if you have that. there is always, i think, the great benefit of contributing to your retirement plan. some people might say you are converting what could be capital gains or dividends into ordinary income in the future. the reality is that deferral, for 20 or 30 years, it will

outweigh the risks. they are likely to go to ordinary tax rates and let's not forget untempered at the income tax. ashley: there is so much uncertainty of what is coming down the pipe. >> you contribute to the 401k. >> this is something that an investor buys them a look at this throughout the year. we take advantage of losses, meaning that the amount of income, your investment has actually gone down rather than holding out and waiting for that come back. you pay $10, you book a 5-dollar loss. music to offset capital gains in the future. if you don't use of this year, it carries over into future years as well. you can do that with individual stocks and mutual funds as well

be one that's a good tip. gift assets to kids? >> you have this huge exemption, but telling us about middle income people come you don't have to have a lot of income to get that exemption away. the idea is to put some money into the next generation. have income and capital gains tax at the younger generations rate. also, you might be reducing estate tax and benefits at the same time. ashley: we are running out of time, but what about making a hobby into a business? >> make it a real business. there are benefits to having small business. the reality is we can offset your income relative to equipment, services, computers, things like that, you also have the ability to contribute to self-employed pension plans, which has a much higher

limitation in the 401k plan or an ira. these benefits could be because this stems from a hobby. ashley: some very great tips. rich, thank you so much. still to come, find out how much taxpayers are spending on the presidents and first families lavish vacation. next, they are not buying homes or cars or durable goods. what are consumers spending their money on? iphone-5 and answers after the raid

ashley: bucking the bad economy. what americans are sacrificing for their smart smartphones. that is coming up in two minutes.

ashley: in focus tonight, you

and your budget. a slew of hot gadgets and products hitting the shelves. people are too scared to buy. holiday shopping around the corner, but so is the looming fiscal cliff. already, a down economy. chairman of the retail group, thank you so much for being here. are consumers feeling confident right now? we have an election out there, we have the fiscal cliff. jobs are still an issue. the economy is still an issue. all of this considered, is the consumer still ready? >> they are on a short-term basis. they still have a job and they feel that their own little world is protected. they are only thinking the short-term. it is not lavish.

it is making the right deal. has this really curb the extent of the spending? >> they are spending money on certain items. they are trying to entertain themselves. halloween is coming up. the average sale is $89 or $100. they put on a costume and have a night of fun. but that is not like investing in a new home or going out. like buying a new car. car sales are up, but very, very

cautiously. i think the consumer is looking forward to a holiday. i think we're going to have a good holiday. not a great holiday, but a good holiday. the new trend is for your pets. instead of dressing themselves, they dress up their pets. think about it, you know? ashley: cemented off to college? >> no, no, no. sending them to doggy day care. people are unemployed, people become dog walkers and they have to amuse themselves.

ashley: what lets you know that we are turning the corner? >> the stock market is the very key factor. housing has tremendous comebacks. almost at the all-time high of 2007. they are doing good, they are feeling good, you can refinance now. there is money available. it all goes back to if they have a job.

everything has to be on sale. >> that's right. 50% leased to the retailers. they do so did so much for being here. we appreciate it. we will be right back [ male announcer ] at scottrade, we believe the more you know, the better you trade. so we have ongoing webinars and interactive learning, plus, in-branch seminars at over 500 locations, where our dedicated support teams help you know more so your money can do more. [ rodger ] at scottrade, seven dollar trades are just the start. our teams have the information you want when you need it. it's anothereason more investors are saying... [ all ] i'm with scottrade.